The Canadian credit card scene has changed slightly in the past few months with the introduction of travel rewards cards from Scotia Bank and BMO. These 2 Canadian banks did not offer competitive rewards cards in the past, but that seems to have changed. So are these cards better than some of the others we have already? Well it depends what you are looking for.
The big three cards of the past have been the TD Infinite Visa, the RBC Avion Infinite Visa and the CIBC Aero Gold Infinite Visa. The New are the ScotiaGold Passport Visa and the BMO World Elite MasterCard.
Scotia card comes with 20,000 initial bonus points, plus 10,000 more at the end of the first year. The 30,000 points are estimated to be worth $300 in real money (mind you this will come after paying $209 in annual fees – $99 for the first year and 110 for the second.)
The BMO card carries a fee of $150 per year – this is the highest of any of the major Canadian Travel Rewards cards. The card comes with a signup bonus of $15,000 points, or about $285.
Of the pre-existing cards the real competition has seemed to be between TD and CIBC. If you put a lot of value on being able to choose your travel and then use points to pay for it, go with TD. If, on the other hand, you simply want to be able to trade your points for their maximum cash value and you don’t really mind picking your flight/vacation from a list provided by the bank – go with the CIBC Aero Gold.
In terms of sign-up bonus RBC and CIBC are closely tied – RBC however seems to put a maximum value on flights to be purchased with points (we have not seen this to be the case with CIBC, although this is just based on our personal research.) When it comes to trading TD points for real dollars, the exchange rate is poor, but as we stated above, you do get the luxury of buying your travel from just about anywhere.
The Final Verdict: Although it is exciting that Scotia and BMO are getting into the travel reward cards market, we feel the best deal to the consumer is to go with one of the older cards. As far as we can tell, the best way to get the most free money out of a Canadian Travel Rewards card is to go with the CIBC AeroGold Infinite Visa. This card comes with an exceptional initial bonus ($15,000 points – worth somewhere in the area of $300,) an annual fee of $120, and a point rate of 1 Aeroplan point per dollar spent or 1.5 if spent on gas or groceries. We’ve estimated each Aeroplan point to be worth about 1.8 cents. So you are getting approximately 1.8% back on every purchase you make. If you are buying gas or groceries, you are getting about 2.7% back.